Coinbase Hit with $1 Billion Lawsuit Over Wrapped Bitcoin

Coinbase, a popular crypto exchange, is facing a lawsuit from Hong Kong-based BiT Global Digital Limited, seeking damages of over $1 billion. The complaint, filed on Dec. 13 in the Northern District of California, accuses the exchange of anti-competitive practices following its decision to delist Wrapped Bitcoin (wBTC).

Inside The Latest Lawsuit Against Coinbase

The allegations focus on the crypto exchange’s announcement to remove wBTC from its platform, a decision that BiT Global claims caused significant financial losses and reduced market confidence in the token. The lawsuit argues that the delisting was an effort to promote Coinbase’s own wrapped Bitcoin product, cbBTC.

The legal filing cites the Sherman Act, accusing the exchange of attempting to monopolize the wrapped Bitcoin market. BiT Global also accuses the exchange of using predatory tactics to damage wBTC’s standing and of making false claims about the token’s compliance with listing criteria.

In a prior statement, a Coinbase spokesperson explained the rationale behind the delisting, stating, “Coinbase is committed to maintaining the high integrity of our listing standards, and we regularly evaluate assets listed on our platform. Should an asset fail to meet those standards, it is delisted.”

Official Comments

The lawsuit was filed by Kneupper & Covey, a law firm representing BiT Global. Kevin Kneupper, an attorney for the firm, expressed concerns about the broader implications of the exchange’s actions. “We believe this decision sets a terrible precedent for everyone in the cryptocurrency space,” he said. “If an exchange of Coinbase’s size can delist a cryptocurrency just as it plans to launch its own competing product, who’s safe? And who’s next?”

BiT Global, which serves as a joint custodian of wBTC’s Bitcoin reserves alongside BitGo, views the move as an attempt to undermine wBTC in favor of cbBTC. Earlier, a BiT Global spokesperson alleged, “It’s clear that Coinbase’s decision is an attempt to gain a competitive advantage, pushing forward their own wrapped Bitcoin product, cbBTC, and removing the largest and most influential competitor in wBTC,” according to a CoinTelegraph report.

Coinbase had previously announced that trading for wBTC would be suspended on Dec. 19, citing a review of its listing standards.

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